AirJoule Technologies Corp.
For the period ended Dec 31, 2025. Filed Mar 31, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 31, 2026
AIRJ$2.39+13.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-25.
0001013762-25-002263
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-31.
0001193125-26-133335
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 115 previous paragraphs and 123 current paragraphs.
46 unchanged; 31 reworded; 45 added; 37 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 7 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (45)
Current report
Field Deployments and Demonstrations
Current report
During 2025, the AirJoule JV transitioned from laboratory testing to real-world field deployments across multiple geographies and climate conditions. From February 2025 through December 2025, the AirJoule JV and TenX Investment operated an AirJoule showcase system at the Dubai Future Lab in the United Arab Emirates. The system operated through wide temperature and humidity swings, generating high purity distilled water and demonstrating operational reliability in the region’s extreme climate conditions.
Current report
In September 2025, the AirJoule JV deployed our first full-scale AirJoule Core system to Hubbard, Texas, where the AirJoule JV demonstrated AirJoule’s ability to produce pure distilled water from ambient air. The system operated continuously for several months and generated performance data across varying environmental conditions.
Current report
In December 2025, the AirJoule JV announced a collaboration with the Red Dot Ranch Foundation for off-grid residential water solutions in Pescadero, California. Initial testing of the Core system began in January 2026 and was completed in February 2026.
Current report
In December 2025, the AirJoule JV sold a Core system to Arizona State University (“ASU”), where it is undergoing independent academic evaluation led by Dr. Paul Westerhoff, Regents Professor and Director of ASU’s Global Center for Water Technology. The evaluation, which includes planned peer-reviewed published research, is being conducted in the greater Phoenix area where temperatures exceed 110°F and relative humidity regularly falls below 20%. This represents one of the most demanding environments for atmospheric water harvesting.
Current report
Revenue will be earned primarily from the assembly and sale of AirJoule systems. As of December 31, 2025, the AirJoule JV recognized $0.1 million of revenue.
Current report
General and administrative: General and administrative expenses consist primarily of personnel-related expenses for our executives, consultants and advisors. These expenses also include non-personnel costs, such as rent, office supplies, legal, audit and accounting services and other professional fees.
Current report
Research and development: Research and development expenses include internal personnel, parts, prototypes and third-party consulting costs related to preliminary research and development of our products.
Current report
Sales and marketing: Sales and marketing expenses consist primarily of business development professional fees, advertising and marketing costs.
Current report
Transaction costs incurred in connection with business combination: Transaction costs represent the initial recognition of the Earnout Shares liability and fees incurred for financial advisory, legal and other professional services that were directly related to the Business Combination.
Current report
Depreciation and amortization: Depreciation and amortization expense consists of depreciation of property and equipment.
Current report
Depreciation and amortization expenses for the year ended December 31, 2025 and 2024 were $9,837 and $6,517, respectively.
Current report
Interest income was $1.0 million and $0.9 million for the year ended December 31, 2025 and 2024, respectively.
Current report
Change in Fair Value of Equity Line Obligation Liability
Current report
On March 25, 2025, we entered into a Equity Line Purchase Agreement with B. Riley Principal Capital II, LLC. See Note 2 -Liquidity and Capital Resources. During the year ended December 31, 2025, we recognized a $(0.5) million change in the fair value of the related liability, primarily driven by the initial recognition of the liability at fair value upon inception of the agreement and subsequent activity under the facility, including sales of common stock.
Current report
The April 2025 PIPE
Current report
On April 23, 2025, we entered into the April 2025 PIPE Subscription Agreements with the April 2025 PIPE Investors pursuant to which, among other things, the April 2025 PIPE Investors agreed to subscribe for and purchase from the Company, and we agreed to issue and sell to the April 2025 PIPE Investors, an aggregate of 3,775,126 newly issued shares of Class A common stock at a purchase price of $3.98 per share on the terms and subject to the conditions set forth therein. The April 2025 PIPE Subscription Agreements entitled the April 2025 PIPE Investors to shelf registration rights with respect to the shares of Class A common stock they purchased. The transaction closed on April 25, 2025, and the shares of Class A common stock were issued and sold to the April 2025 PIPE Investors in reliance on Section 4(a)(2) of the Securities Act generating net proceeds of $14.2 million.
Current report
Committed Equity Facility
Current report
On March 25, 2025, we entered into the Equity Line Purchase Agreement with the Equity Line Investor. Under the terms and subject to the conditions of the Equity Line Purchase Agreement, the Company has the right, but not the obligation, to sell to the Equity Line Investor, over a 36-month period, up to an aggregate of $30,000,000 of our newly issued shares of common stock subject to certain conditions and limitations contained in the Equity Line Purchase Agreement, including that we may issue no more than the number of shares equal to 19.99% of the aggregate number of our issued and outstanding shares of common stock as of immediately prior to the execution of the Equity Line Purchase Agreement without first obtaining stockholder approval. As of December 31, 2025, 755,946 shares were sold under the Equity Line Purchase Agreement generating proceeds of approximately $3.0 million.
Current report
Capital Contributions
Current report
General
Current report
During the year ended December 31, 2025, net cash used in operating activities was $5.6 million and primarily reflected our net loss of $(9.0) million. Cash used in operating activities was partially offset by non-cash expenses, including equity loss from investment in AirJoule, LLC, stock-based compensation and changes in fair values of our complex liabilities. Changes in operating assets and liabilities used $2.6 million of cash and were primarily attributable to decreases in our due from related party receivable, as well as increases in accrued liabilities and payables related to the expansion of our operations. We expect to continue to use cash in our operating activities with the expected growth of our business.
Current report
During the year ended December 31, 2025, net cash used in investing activities was $17.8 million, primarily as a result of our contributions made to the AirJoule JV during the period.
Current report
During the year ended December 31, 2025, net cash provided by financing activities was $17.2 million, primarily as a result of the $14.2 million of net proceeds from the April 2025 PIPE Offering, approximately $3.0 million, from the Equity Line Purchase Agreement and $0.1 million of proceeds from the exercise of options and purchases pursuant to our employee stock purchase plan.
Current report
Certain of these estimates require the use of significant judgment because they involve assumptions that are inherently uncertain and may change as new information becomes available. If actual results differ from these estimates, the resulting changes could have a material effect on our consolidated financial statements. We consider an accounting estimate to be critical if it requires management to make assumptions about matters that are highly uncertain and if different estimates could reasonably have a material impact on our financial condition or results of operations.
Current report
Stock-Based Compensation
Current report
We grant stock-based awards to employees, directors and certain non-employees as part of our compensation programs. Determining the grant-date fair value of stock-based awards requires management to make estimates and assumptions that involve significant judgment.
Current report
The most significant assumptions used in estimating the fair value of stock option awards include the expected term of the award, expected stock price volatility, the risk-free interest rate and the fair value of our common stock on the grant date. Expected volatility is estimated using a combination of our historical volatility and the volatility of comparable publicly traded companies due to our limited trading history. The expected term of awards reflects management’s estimate of the period the awards are expected to remain outstanding based on historical exercise behavior and contractual terms.
Current report
We have also issued awards containing market and performance-based vesting conditions. The fair value of these awards is estimated using a Monte Carlo simulation model that incorporates assumptions regarding stock price volatility, expected term, risk-free interest rates and the probability of achieving performance conditions. These assumptions are inherently uncertain, and changes in these assumptions could materially affect the grant-date fair value of awards and the amount of stock-based compensation expense recognized in future periods.
Current report
Upon the exercise of stock options or settlement of restricted stock units, we issue newly issued shares of Class A common stock. We do not currently use treasury shares to settle equity awards. We do not currently expect to repurchase shares in the following year to satisfy equity award settlements.
Current report
We granted Earnout Share awards to certain employees in connection with the Business Combination. These awards are considered compensatory. The performance-based vesting conditions are not deemed probable of achievement as of December 31, 2025.
Current report
The fair value of the Earnout Shares liability is estimated using a Monte Carlo simulation model that incorporates assumptions regarding projected EBITDA, the expected timing of commissioning production lines, stock price volatility, risk-free interest rates and the correlation between stock price and operating performance. Estimates regarding the timing of commissioning production lines and expected operating performance are based on management’s projections regarding the commercialization and scaling of our technology.
Current report
Because these assumptions involve significant judgment and are subject to change as our business evolves, changes in these assumptions could materially affect the estimated fair value of the Earnout Shares liability and result in significant gains or losses recognized in our consolidated statements of operations.
Current report
Certain financial instruments issued in connection with the Business Combination and related financing transactions are classified as liabilities and measured at fair value at each reporting period. These instruments include the True Up Shares, Subject Vesting Shares and the Equity Line Obligation.
Current report
The fair value of these instruments is determined using valuation models that incorporate significant assumptions, including stock price volatility, expected term, risk-free interest rates and the probability of achieving certain market or operational conditions. Certain valuations utilize Monte Carlo simulation techniques to model potential outcomes for our stock price and operational milestones.
Current report
Because these valuations rely on assumptions about future market conditions and company performance, which are inherently uncertain, changes in these assumptions could materially affect the estimated fair value of these instruments and may result in significant gains or losses recognized in future periods. See Note 12 – Fair Value Measurements.
Current report
We account for investments in entities over which we have significant influence but do not control using the equity method of accounting. Our investment balance reflects our share of the investee’s earnings or losses and is adjusted for basis differences identified at the time of investment.
Current report
We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. This evaluation requires significant judgment in assessing the investee’s financial condition, expected future operating performance, industry conditions and the estimated fair value of the investment.
Current report
Key assumptions used in this assessment may include projections of the investee’s future revenues, operating margins and the timing and likelihood of achieving anticipated business milestones. These assumptions are inherently uncertain because they depend on future market conditions and the investee’s operational performance. If the estimated fair value of the investment is determined to be less than its carrying value and the decline is considered other than temporary, we would record an impairment charge equal to the difference between the carrying value and estimated fair value.
Current report
The accounting classification of warrants requires management to evaluate the contractual terms of the instruments and determine whether they should be classified as equity or as liabilities. This evaluation requires judgment in assessing whether the warrants meet the criteria for equity classification under applicable accounting guidance, including whether the warrants are indexed to the Company’s own stock and whether they meet the conditions for equity classification.
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Removed paragraphs (37)
Previous report
Change of Company Name
Previous report
AirJoule Technologies Corporation
Previous report
Effective November 13, 2024, Montana Technologies Corporation changed its corporate name to AirJoule Technologies Corporation, pursuant to an amended and restated certificate of incorporation filed with the Delaware Secretary of State.
Previous report
AirJoule Technologies LLC
Previous report
Effective November 13, 2024, Montana Technologies LLC changed its corporate name to AirJoule Technologies LLC, pursuant to an amended and restated certificate of incorporation filed with the Delaware Secretary of State.
Previous report
Statement of Work – Related Party
Previous report
In November 2024, we executed a statement of work with AirJoule, LLC under the Master Services Agreement, dated as of March 4, 2024, by and between us and AirJoule, LLC, pursuant to which we will provide AirJoule, LLC with engineering and administrative services. Once each calendar year, unless otherwise agreed by the Board of Managers of AirJoule, LLC, or the AJ Board, we will provide equity awards to AirJoule, LLC employees in amounts approved by the AJ Board.
Previous report
We anticipate that we will earn revenue from the sale of various key components that will be used in the assembly of AirJoule systems. As of December 31, 2024, no revenue has been earned from our operations.
Previous report
Depreciation and amortization expense for the year ended December 31, 2024 and 2023 was $6,517 and $4,341, respectively.
Previous report
Interest income was $0.9 million and $11,541 for the year ended December 31, 2024 and 2023, respectively. This is a result of the increase in our cash balance.
Previous report
During the year ended December 31, 2024, we recognized a gain on the settlement of legal fees related to the transaction costs of the Business Combination. There were no such gains in year ended December 31, 2023.
Previous report
With the consummation of the Business Combination and Subscription Agreements (as described above and in Note 4 –Recapitalization), we received gross proceeds of approximately $43.4 million in the first quarter of 2024 and approximately $6.0 million in May 2024. Additionally, in June 2024, we received gross proceeds of approximately $12.4 million from existing and new investors for 1,238,500 million shares of Class A common stock pursuant the June 2024 PIPE Subscription Agreements entered into on June 5, 2024.
Previous report
During the year ended December 31, 2023, net cash used in operating activities was $5.1 million and primarily reflected our net loss from operations offset by an increase in accounts payable and accrued expenses and other liabilities.
Previous report
During the year ended December 31, 2023, minimal cash was provided by financing activities.
Previous report
Future minimum royalties for 2025 and each year through the date the patents expire are $0.3 million.
Previous report
Share-Based Compensation
Previous report
We account for share-based compensation arrangements granted to employees and non-employees in accordance with ASC 718,Share-based Compensation, by measuring the grant date fair value of each award and recognizing the resulting expense over the period during which the recipient is required to perform services in exchange for the award. Equity-based compensation expense is only recognized for awards subject to performance conditions if it is probable that the applicable performance conditions will be achieved. We account for forfeitures when the forfeitures occur.
Previous report
We estimate the fair value of stock option awards subject to only a service condition on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires the use of highly subjective and complex assumptions, including the stock option’s expected term, the price volatility of the underlying stock, the applicable risk-free interest rate, and the expected dividend yield of the underlying common stock, as well as an estimate of the fair value of the common stock underlying the stock option.
Previous report
We estimate the fair value of Earnout Shares (as described below), which are considered compensatory awards and accounted for under ASC 718, using the Monte-Carlo simulation model*.*The Monte-Carlo simulation model was selected as the valuation methodology for the Earnout Shares due to the path-dependent nature of applicable triggering events. Under ASC 718, such Earnout Shares are measured at fair value as of the grant date and expense is recognized over the applicable time-based vesting period (the applicable triggering event is a market condition and does not impact expense recognition). The Monte-Carlo model requires the use of highly subjective and complex assumptions, estimates and judgements, including the current stock price, the volatility of the underlying stock, the expected term, the risk-free interest rate, the selection of comparable companies, and the probability of possible future events. Changes in any or all of these estimates and assumptions or the relationships between those assumptions impact our valuations as of each valuation date and may have a material impact on the valuation of share based compensation arrangements. An increase of 100-basis points in interest rates would not have a material impact on our share-based compensation. During the period from the date of the Business Combination through December 31, 2024 we did not record share-based compensation expense associated with these Earnout Shares as the performance conditions associated with these Earnout Shares were not deemed probable of achievement. Unrecognized share-based compensation expense for these Earnout Shares with a performance-based vesting condition that was not deemed probable of occurring as of December 31, 2024 was $6.6 million which is expected to vest subject to the performance-based vesting condition being satisfied or deemed probable.
Previous report
We estimated fair value of the Earnout Shares with a Monte Carlo simulation using a distribution of potential outcomes for expected earnings before interest, taxes, depreciation, and amortization, or EBITDA, and stock price at expected commission dates, utilizing a correlation coefficient for EBITDA and stock price, and assuming $50.0 million of Annualized EBITDA per production line, with each of the production lines commissioned over a five-year period. EBITDA was discounted to the valuation date with a weighted average cost of capital estimate and forecasted to each estimated commission date. Earnout mechanics at each estimated commission date were assessed, and if the Earnout Thresholds were achieved, the future value of the Earnout Shares was discounted to the valuation date utilizing a risk-free rate commensurate with the overall term. Expected EBITDA assumes that each production line will achieve equivalent production generating $50.0 million of Annualized EBITDA. The commission dates used reflected management’s best estimates regarding the time to complete full construction and operational viability of a production line, including all permitting, regulatory approvals and necessary or useful inspections. The Earnout term of 5 years and the Earnout mechanics represent contractual inputs. The contingent Earnout Shares liability involves certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts.
Previous report
We do not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. We evaluate all of its financial instruments, including the True Up Shares issued in connection with the Subscription Agreement and the Subject Vesting Shares issued in connection with the Business Combination, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 (defined below) and FASB ASC 815, Derivatives and Hedging, or ASC 815. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period.
Previous report
The True Up Shares issued under the Subscription Agreement do not qualify as equity under ASC 815; therefore, the Class A common stock, or the True Up Shares is required to be classified as a liability and measured at fair value with subsequent changes in fair value recorded in earnings. Changes in the estimated fair value of the derivative liability is recognized as a non-cash gain or loss on the consolidated statements of operations. The fair value of the derivative liability is discussed in Note 12 -Fair Value Measurements.
Previous report
The Subject Vesting Shares liability was an assumed liability of XPDB. The Subject Vesting Shares liability vest and are no longer subject to forfeiture as described in Note 4 -Recapitalization. They do not meet the “fixed-for-fixed” criterion and thus are not considered indexed to the issuer’s stock. As such, management determined that the Subject Vesting Shares should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in earnings. The estimated fair value of the Subject Vesting Share liability was determined utilizing a Monte Carlo simulation, with underlying forecast mathematics based on geometric Brownian motion in a risk-neutral framework. The calculation of the value of the Subject Vesting Shares considered the $12.00 and $14.00 vesting conditions in addition to the vesting related to the Earnout Milestone Amount. The Subject Vesting Shares liability involves certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts. See Note 12 –Fair Value Measurements.
Previous report
Business Combinations
Previous report
We evaluate whether acquired net assets should be accounted for as a business combination or an asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If so, the transaction is accounted for as an asset acquisition. If not, we apply judgement to determine whether the acquired net assets meet the definition of a business by considering if the set includes an acquired input, process, and the ability to create outputs.
Previous report
We account for business combinations using the acquisition method of accounting whereby the identifiable assets and liabilities of the acquired business, including contingent consideration, as well as any non-controlling interest in the acquired business, are recorded at their estimated fair values as of the date that we obtain control of the acquired business. We measure goodwill as the fair value of the consideration transferred including the fair value of any non-controlling interest recognized, less the net recognized amount of the identifiable assets and liabilities combined, all measured at their fair value as of the acquisition date. Transaction costs, other than those associated with the issuance of debt or equity securities, that we incur in connection with a business combination are expensed as incurred.
Previous report
Any contingent consideration is measured at fair value at the acquisition date. For contingent consideration that does not meet all the criteria for equity classification, such contingent consideration is required to be recorded at its initial fair value at the acquisition date, and on each balance sheet date thereafter. Changes in the estimated fair value of liability-classified contingent consideration are recognized on the consolidated statements of operations in the period of change.
Previous report
Several valuation methods may be used to determine the fair value of assets acquired and liabilities assumed. For intangible assets, we typically use a variation of the income approach, whereby a forecast of future cash flows attributable to the asset is discounted to present value using a risk-adjusted discount rate. Some of the more significant estimates and assumptions inherent in the income approach include the amount and timing of projected future cash flows, the discount rate selected to measure the risks inherent in the future cash flows, and the assessment of the asset’s expected useful life. When the initial accounting for a business combination has not been finalized by the end of the reporting period in which the transaction occurs, we report provisional amounts. Provisional amounts are adjusted during the measurement period, which does not exceed one year from the acquisition date. These adjustments, or recognition of additional assets or liabilities, reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.
Previous report
In accordance with ASC 323,Investments - Equity Method and Joint Ventures, investments in entities over which we do not have a controlling financial interest but has significant influence are accounted for using the equity method, with our share of earnings or losses reported in earnings or losses from equity method investments on the statements of operations.
Previous report
Under the equity method of accounting, our investment is initially recorded at fair value on the consolidated balance sheets. Upon initial investment, we evaluate whether there are basis differences between the carrying value and fair value of our proportionate share of the investee’s underlying net assets. Typically, we amortize basis differences identified on a straight-line basis over the underlying assets’ estimated useful lives when calculating the attributable earnings or losses, excluding the basis differences attributable to in-process research and development and goodwill. If we are unable to attribute all of the basis differences to specific assets or liabilities of the investee, the residual excess of the cost of the investment over the proportional fair value of the investee’s assets and liabilities is considered to be equity method goodwill and is recognized within the equity investment balance, which is tracked separately within our memo accounts. We subsequently record in the statements of operations our share of income or loss of the other entity within other income/expense, which results in an increase or decrease to the carrying value of our investment. If the share of losses exceeds the carrying value of our investment, we will suspend recognizing additional losses and will continue to do so unless we commit to providing additional funding.
Previous report
We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that a decline in value has occurred that is other than temporary. Evidence considered in this evaluation includes, but would not necessarily be limited to, the financial condition and near-term prospects of the investee, recent operating trends and forecasted performance of the investee, market conditions in the geographic area or industry in which the investee operates and our strategic plans for holding the investment in relation to the period of time expected for an anticipated recovery of its carrying value. If the investment is determined to have a decline in value deemed to be other than temporary it is written down to estimated fair value.
Previous report
Additionally, if an equity method investee recognizes a goodwill impairment charge in its separate financial statements, we will recognize its share of the impairment in its financial statements in the same manner in which it recognizes other earnings of the investee.
Previous report
Warrants
Previous report
We determine the accounting classification of warrants issued as either liability or equity classified by first assessing whether the warrants meet liability classification in accordance with ASC 480-10,Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, or ASC 480, then in accordance with ASC 815-40,Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, or ASC 815. In order for a warrant to be classified in stockholders’ deficit, the warrant must be (i) indexed to our equity and (ii) meet the conditions for equity classification.
Previous report
If a warrant does not meet the conditions for stockholders’ deficit classification, it is carried on the consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in other non-operating losses (gains) in the consolidated statements of operations. If a warrant meets both conditions for equity classification, the warrant is initially recorded, at its relative fair value on the date of issuance, in stockholders’ deficit in the consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value.
Previous report
Prior to the Business Combination on March 14, 2024, we were a limited liability company, or LLC, and treated as a partnership for income tax purpose. As a Partnership, we were not directly liable for federal income taxes. As of the date of the Business Combination, the operations of the Company ceased to be taxed as a partnership resulting in a change in tax status for federal and state income tax purposes.
Previous report
We follow the asset and liability method of accounting for income taxes under ASC 740,Income Taxes, or ASC 740. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that is included in the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Reworded paragraphs (31)
Previous wording
The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction Part I of this Annual Report on Form 10-K, the consolidated financial statements and related notes included in Part II Item 8 in this Annual Report on Form 10-K and the section titled “Cautionary Note Regarding Forward-Looking Statements” included in the forepart in this Annual Report on Form 10-K.
Current wording
The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with Part I of this Annual Report on Form 10-K, the consolidated financial statements and related notes included in Part II Item 8 in this Annual Report on Form 10-K and the section titled “Cautionary Note Regarding Forward-Looking Statements” included in the forepart in this Annual Report on Form 10-K.
Previous wording
This discussion includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Such statements include, but are not limited to, possible business combinations and the financing thereof, and related matters, as well as all other statements other than statements of historical fact included herein. Factors that might cause or contribute to such a discrepancy include, but are not limited to: our status as an early stage company with limited operating history, which may make it difficult to evaluate the prospects for our future viability; our initial dependence on revenue generated from a single product; significant barriers we face to deploy our technology; the dependence of our commercialization strategy on our relationship with third parties; our history of losses; accuracy of assumptions underlying projections related to our equity method goodwill impairment testing; and other risks and uncertainties described in our other SEC filings.
Current wording
This discussion includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “will,” “expect,” “might,” “plan,” “anticipate,” “could,” “intend,” “target,” “goal,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” “seek,” “would,” “continue,” or the negative of such terms or other similar expressions. Such statements include, but are not limited to, possible business combinations and the financing thereof, and related matters, as well as all other statements other than statements of historical fact included herein. Factors that might cause or contribute to such a discrepancy include, but are not limited to: our status as an early stage company with limited operating history, which may make it difficult to evaluate the prospects for our future viability; our initial dependence on revenue generated from a single product; significant barriers we face to deploy our technology; the dependence of our commercialization strategy on our relationship with third parties; our history of losses; accuracy of assumptions underlying projections related to our equity method goodwill impairment testing; and other risks and uncertainties described in our other SEC filings.
Previous wording
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination (as defined below), the business and operations of AirJoule Technologies Corporation, formerly known as Montana Technologies Corporation and its consolidated subsidiaries, and (ii) prior to the Business Combination, AirJoule Technologies LLC, formerly known as Montana Technologies LLC, or Predecessor, (the predecessor entity in existence prior to the consummation of the Business Combination) and its consolidated subsidiaries.
Current wording
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination (as defined below), the business and operations of AirJoule Technologies Corporation, formerly known as Montana Technologies Corporation and its consolidated subsidiaries, and (ii) prior to the Business Combination, AirJoule Technologies LLC, formerly known as Montana Technologies LLC, or Legacy Montana, and its consolidated subsidiaries.
Previous wording
We are a water harvesting technology company that aims to provide energy and cost-efficient water harvested from air. Our product, AirJoule, is a climate solution technology that harvests the water vapor in the atmosphere and produces pure distilled water to improve water security and sustainability for businesses and consumers around the world. AirJoule is especially valuable for industrial users, which generate significant amounts of waste heat that can be utilized to produce pure distilled water and dehumidified air – two key inputs for variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, our AirJoule technology is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants, and generate material cost efficiencies for air conditioning systems. We are focused on commercialization and scaling manufacturing of our AirJoule systems through our global partnerships with GE Vernova and Carrier , and we believe that deploying AirJoule units worldwide can help to improve water security and reduce global emissions. We plan to manufacture AirJoule units capable of producing 1,000 liters per day in 2025, which we intend to use for customer demonstrations, and we expect to scale capacities for commercial sales in 2026.
Current wording
We are an advanced technology company whose purpose is to free the world from its water and energy constraints by delivering groundbreaking sorption technologies. Our platform technology, AirJoule, produces pure distilled water from air and, at commercial scale, will mitigate water scarcity through distributed water generation for businesses and consumers around the world. Our products are especially valuable for industrial users, which generate significant amounts of waste heat that can be used to power our sorption technologies to produce low cost pure distilled water and dehumidified air – two key inputs for a variety of industrial activities, including data centers and advanced manufacturing. In HVAC applications, our technology is designed to reduce energy consumption, minimize or even eliminate the use of environmentally-harmful refrigerants and generate material cost efficiencies for air conditioning systems. We are commercializing and scaling manufacturing of our AirJoule systems through our global collaborations, including our 50/50 joint venture with GE Vernova Inc. (NYSE: GEV) and our commercial partnerships with Carrier Global Corporation (NYSE: CARR) and TenX Investment in Energy Enterprises & Management Co. We believe that deploying AirJoule systems worldwide will unleash the power of water from air and help to improve global water security. During 2025, we manufactured and deployed AirJoule Core systems (previously referred to as our A250 systems) for field testing and customer demonstrations in Texas, Arizona and Dubai, and we advanced the productization and manufacturing scale-up of our Core and larger Prime (previously referred to as our A1000 system) system in preparation for commercial sales beginning in late 2026.
Previous wording
We anticipate significant growth opportunities by offering AirJoule in global markets where demand for water, dehumidified air and cooling are highest. With our proprietary technology, we believe that we are uniquely positioned to provide curated solutions that satisfy our customers’ needs and expectations in fast-growing and water and energy-intensive industries, such as data centers and advanced manufacturing, along with military and HVAC applications. We estimate the combined total addressable market to be approximately $450 billion.
Current wording
We anticipate significant growth opportunities by offering the AirJoule technology in global markets where demand for water, dehumidified air and cooling are highest. With our technology platform, we believe that we are uniquely positioned to provide solutions that satisfy our customers’ needs and expectations in fast-growing and water and energy-intensive industries, such as data centers and advanced manufacturing, along with military and HVAC applications. We estimate the combined total addressable market to be approximately $450 billion.
Previous wording
In the data center arena, we aim to address escalating energy and water efficiency challenges associated with increased computing density by using low-grade waste heat to produce pure distilled water and enabling data center operators to reduce their cooling costs and improve water sustainability. Similarly, in advanced manufacturing environments, where product quality and process precision hinge on consistent humidity and ultra-pure water, AirJoule can help customers with cost-effective dehumidification. The military sector presents a distinct opportunity, as AirJoule is able to operate in a variety of climate conditions to support troops in remote and water-scarce environments, ensuring mission readiness and resilience. In the HVAC space, where building owners and facility managers are under pressure to cut energy consumption and improve indoor air quality, AirJoule’s superior moisture removal capability will reduce power consumption and the use of refrigerants in air conditioning systems.
Current wording
In the data center arena, we aim to address escalating energy and water efficiency challenges associated with increased computing density by using low-grade waste heat to produce pure distilled water and enabling data center operators to reduce their cooling costs and improve water sustainability. Similarly, in advanced manufacturing environments, where product quality and process precision depend on consistent humidity and ultra-pure water, our technology can help customers with cost-effective dehumidification. The military sector presents a distinct opportunity, as AirJoule is able to operate in a variety of climate conditions to support troops in remote and water-scarce environments, ensuring mission readiness and resilience. In the HVAC space, where building owners and facility managers are under pressure to cut energy consumption and improve indoor air quality, AirJoule’s superior moisture removal capability can reduce power consumption and the use of refrigerants in air conditioning systems.
Previous wording
To accelerate market penetration and scale our manufacturing capabilities, we plan to leverage our strategic partnerships, which are discussed below. These partnerships offer access to industry-specific R&D expertise, mature supply chains, established sales channels, and extensive service networks, allowing us to quickly move from pilot deployments to full-scale commercialization. We intend to co-develop sector-specific solutions, capitalizing on our partners’ market insights and reputational strength to better serve diverse customer needs. By combining our innovative AirJoule technology with their global reach and operational expertise, we will unlock value across multiple industries, establish our position as a leader in water-focused solutions, and deliver long-term growth and value to our shareholders.
Current wording
To accelerate market penetration and scale our manufacturing capabilities, we plan to leverage our strategic partnerships. These partnerships offer access to industry-specific R&D expertise, mature supply chains, established sales channels and extensive service networks, allowing us to quickly move from pilot deployments to full-scale commercialization. We intend to co-develop sector-specific solutions, capitalizing on our partners’ market insights and reputational strength to better serve diverse customer needs. By combining our innovative AirJoule technology with their global reach and operational expertise, we expect to unlock value across multiple industries, establish our position as a leader in water-focused solutions and deliver long-term growth and value to our shareholders.
Previous wording
General and administrative expenses for the year ended December 31, 2024 was $9.0 million as compared to $7.5 million for the year ended December 31, 2023. The $1.5 million increase was primarily related to increases in professional services such as legal and audit and accounting offset by the reimbursement of costs incurred per the statement of work with AirJoule, LLC. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business and increased expenditures associated with our status as an exchange listed public company.
Current wording
General and administrative expenses for the year ended December 31, 2025 were $12.5 million as compared to $9.0 million for the year ended December 31, 2024. The $3.4 million increase was primarily related to a $3.8 million increase in stock-based compensation expense and a $1.6 million increase in salaries and benefits as a result of an increased headcount offset by an increase in the reimbursement of costs incurred per the statement of work with AirJoule, LLC of $0.8 million, a $0.7 million decrease in accounting, audit and legal fees, a $0.4 million decrease in professional services and a $0.1 million decrease in insurance expense. We expect that our general and administrative expenses will increase in future periods commensurate with the expected growth of our business.
Previous wording
Research and development expenses for the year ended December 31, 2024 was $2.0 million as compared to $3.3 million for the year ended December 31, 2023. The $1.3 million decrease was primarily related to the reimbursement of costs incurred per the statement of work with AirJoule, LLC, partially offset by an increase in personnel and prototype related costs as the Company continues to develop its products and technology. We expect that our research and development expenses will increase in future periods commensurate with the expected growth of our business.
Current wording
Research and development expenses for the year ended December 31, 2025 were $1.0 million as compared to $2.0 million for the year ended December 31, 2024. The $1.0 million decrease was primarily related to a decrease in the purchase of materials and services of $2.0 million and the decrease in patent and royalty fees of $0.7 million offset by the decrease in reimbursement of costs incurred per the statement of work with AirJoule, LLC of $1.3 million and the increase in stock-based and employee compensation expense of $0.4 million.
Previous wording
Sales and marketing for the year ended December 31, 2024 was $0.2 million as compared to $0.5 million for the year ended December 31, 2023. In 2023, we incurred non-recurring expenses related to business development that ended in July 2023. We expect that our sales and marketing expenses will increase in future periods commensurate with the expected growth of our business.
Current wording
Sales and marketing expenses for the year ended December 31, 2025 were $79,326 as compared to $150,927 for the year ended December 31, 2024. We expect that our sales and marketing expenses will increase in future periods commensurate with the expected growth of our business.
Previous wording
An equity method investment received in exchange for noncash consideration is measured at fair value. As a result, for the year ended December 31, 2024, we recognized a gain of $333.5 million on the contribution to AirJoule, LLC for the difference between our zero carrying value and the fair value of the perpetual license to intellectual property that we transferred to AirJoule, LLC.
Current wording
An equity method investment received in exchange for non-cash consideration is measured at fair value. As a result, for the year ended December 31, 2024, we recognized a gain of $333.5 million on the contribution to AirJoule, LLC which represents the difference between our carrying value and the fair value of the perpetual license to intellectual property that we transferred to AirJoule, LLC.
Previous wording
As previously noted, on January 25, 2024, AirJoule Technologies, LLC entered into a joint venture with GE Ventures LLC, the AirJoule JV which closed on March 4, 2024. For the year ended December 31, 2024, we recognized a loss of $5.3 million from our 50% equity investment in the AirJoule JV.
Current wording
As previously noted, on January 25, 2024, AirJoule Technologies, LLC entered into a joint venture with GE Ventures LLC, the AirJoule JV which closed on March 4, 2024. For the year ended December 31, 2025 and 2024, we recognized a loss of $39.3 million and $5.3 million from our 50% equity investment in the AirJoule JV, respectively.
Previous wording
Upon consummation of the Business Combination, we expensed $53.7 million in Earnout Shares (as described in “-Earnout Shares Liability”) liability. The change in fair value of $29.2 million for the year ended December 31, 2024 is due to a decrease in the estimated fair value of the liability and is recognized as a gain in the consolidated statements of operations. The fair value of the liability decreased primarily due to changes in the valuation inputs, mainly a decrease in the stock price, a change in the timing of future cash flows and an increase in the volatility.
Current wording
Upon consummation of the Business Combination, we expensed $53.7 million in Earnout Shares (as described in “- Earnout Shares Liability”) liability. The change in fair value of $18.3 million and $29.2 million for the years ended December 31, 2025 and December 31, 2024, respectively, was primarily due to a decrease in the estimated fair value of the liability and recognized as gains in the consolidated statements of operations. The fair value of the liability decreased primarily due to changes in the valuation inputs, mainly a decrease in the stock price and changes in the timing of future cash flows.
Previous wording
Upon consummation of the Business Combination, we assumed $0.6 million in earnout true up shares liability. The change in fair value of $1.6 million for the year ended December 31, 2024 is due to a decrease in our stock price. The increase in the estimated fair value of the liability was recognized as a loss in the consolidated statements of operations.
Current wording
Upon consummation of the Business Combination, we assumed $0.6 million in True Up Shares liability. The change in fair value of the liability during the year ended December 31, 2025 was primarily due to the triggering event and issuance of Class A common stock.
Previous wording
Upon consummation of the Business Combination, we assumed $11.8 million for the subject vesting shares liability. The change in fair value of income of $4.0 million during the year ended December 31, 2024 is due to a decrease in the estimated fair value of the liability recognized as a gain in the consolidated statements of operations. The fair value of the liability decreased primarily due to changes in the valuation inputs, mainly a decrease in the stock price, a change in the timing of future cash flows and an increase in the volatility.
Current wording
Upon consummation of the Business Combination, we assumed an $11.8 million Subject Vesting Shares liability. The change in fair value of income of $6.6 million and $4.0 million during the year ended December 31, 2025 and December 31, 2024, respectively, was primarily due to a decrease in the estimated fair value of the liability and recognized as gains in the consolidated statements of operations. The fair value of the liability decreased primarily due to changes in the valuation inputs, mainly a decrease in the stock price and changes in the timing of future cash flows.
Previous wording
Income tax expense was $81.3 million and $0 for the year ended December 31, 2024 and 2023, respectively. During the year ended December 31, 2024, our contribution of a perpetual license to AirJoule, LLC’s intellectual property was measured at fair value and resulted in a book gain and a temporary difference between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax liabilities. The deferred tax expense was partially offset by the recognition of deferred tax assets in connection with the Company now being a corporation through the Business Combination.
Current wording
Income tax benefit (expense) was $18.3 million and $(81.3) million for the year ended December 31, 2025 and 2024, respectively. For the year ended December 31, 2025, the income tax benefit and the resulting effective tax rate differed from the U.S. federal statutory rate primarily due to the impact of state income taxes, including state jurisdictions in which the Company became subject to tax following the Business Combination, as well as changes in deferred tax liabilities associated with temporary differences. Our state effective tax rate of 19.5% for the year ended December 31, 2025 was primarily driven by the remeasurement of deferred tax balances resulting from a decrease in applicable state tax rates from 2024 to 2025. Due to the Company’s significant beginning deferred tax liabilities, this rate change had a disproportionate impact on the current year tax provision; the impact of such remeasurements may vary in future periods. The 2025 effective tax rate was also affected by other permanent items, including the changes in fair value of our liabilities and stock-based compensation expense. During the year ended December 31, 2024, our contribution of a perpetual license to AirJoule, LLC’s intellectual property was measured at fair value and resulted in a book gain and a temporary difference between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax liabilities. The deferred tax expense was partially offset by the recognition of deferred tax assets in connection with the Company’s Business Combination.
Previous wording
Our future capital requirements will depend on many factors, including the timing and extent of spending to support the launch of our product and research and development efforts, the degree to which we are successful in launching new business initiatives and the cost associated with these initiatives, and the growth of our business generally. Pursuant to the A&R Joint Venture Agreement, we contributed $10.0 million in cash to the AirJoule JV at the JV closing and in June 2024, GE Vernova contributed $100 to the AirJoule JV. We have also agreed to contribute up to an additional $90.0 million in capital contributions to the AirJoule JV based on a business plan and annual operating budgets to be agreed between the Company and GE Vernova. In general, for the first six years, GE Vernova has the right, but not the obligation, to make capital contributions to the AirJoule JV.
Current wording
Pursuant to the A&R Joint Venture Agreement, we are expected to contribute additional capital to the AirJoule JV based on a business plan and annual operating budgets to be agreed between us and GE Vernova. During the year ended December 31, 2025, we contributed $17.8 million in capital contributions to the AirJoule JV.
Previous wording
Our primary sources of liquidity have been cash from contributions from founders or equity capital raised from other investors. We had retained earnings of $198.5 million as of December 31, 2024. As of December 31, 2024, we had $27.4 million of working capital including $28.0 million in cash, cash equivalents and restricted cash.
Current wording
Our primary sources of liquidity have been cash from contributions from founders or equity capital raised from other investors. As of December 31, 2025, we had $21.5 million of working capital including $21.8 million in cash, cash equivalents and restricted cash.
Previous wording
In order to finance these opportunities and associated costs, it is possible that we would need to raise additional financing if the proceeds realized to date are insufficient to support our business needs. While we believe that the proceeds realized to date will be sufficient to meet our currently contemplated business needs, management cannot assure that this will be the case. If additional financing is required by us from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital on acceptable terms when needed, our product development business, results of operations and financial condition would be materially and adversely affected.
Current wording
In order to finance these opportunities and associated costs, it is possible that we would need to raise additional financing if the proceeds realized to date are insufficient to support our business needs, including the remaining commitment for capital contributions to the AirJoule JV. While we believe that the proceeds realized to date will be sufficient, management cannot assure that this will be the case. If additional financing is required by us from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital on acceptable terms when needed, our product development business, results of operations and financial condition would be materially and adversely affected.
Previous wording
Gain on Settlement of Legal Fees
Current wording
During the year ended December 31, 2024, net cash used in operating activities was $24.3 million and primarily reflected our net income of $215.7 million, a $81.3 million deferred tax expense, a $53.7 million loss on transaction costs in connection with the business combination, a $5.3 million equity loss from our investment in AirJoule, LLC and $1.3 million of stock-based compensation offset by a $333.5 million gain on contribution to AirJoule, LLC, a decrease of net non-cash operating activities of $31.5 million of changes in fair value of our Earnout Shares liability, True Up Shares liability and Subject Vesting Shares liability, a $14.4 million decrease in our operating assets and liabilities and a gain of $2.2 million on settlement of legal fees.
Previous wording
During the year ended December 31, 2024, net cash used in investing activities was $10.0 million as a result of the Company’s contribution made to AirJoule, LLC.
Current wording
During the year ended December 31, 2024, net cash used in investing activities was $10.0 million, primarily as a result of our contributions made to the AirJoule JV.
Previous wording
During the year ended December 31, 2024, net cash provided by financing activities was $61.9 million and primarily related to proceeds from the issuance of the Predecessor common stock related to private placements prior to the Merger, the exercise of stock options and warrants and the issuance of common stock to PIPE investors.
Current wording
During the year ended December 31, 2024, net cash provided by financing activities was $61.9 million, primarily related to proceeds from the issuance of the Predecessor common stock related to private placements prior to the Merger, the exercise of stock options and warrants and the issuance of common stock to PIPE investors.
Previous wording
In October 2021, we entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, we agreed to a minimum royalty amount of which $0.3 million and $0.2 million was expensed for the year ended December 31, 2024 and 2023, respectively. At December 31, 2024 and December 31, 2023, $0.3 million and $0.2 million, respectively, was accrued in the accompanying consolidated balance sheets.
Current wording
In October 2021, we entered into a patent license agreement with a third party whereby the third party granted us rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such patents expire. In connection with this, we agreed to certain minimum royalty amounts. In September 2025, we entered into the Second Amended and Restated License Agreement which eliminated the minimum royalty amounts through 2029, which resulted in a reversal of $0.5 million in royalties expense.
Previous wording
On October 27, 2021, we entered into a joint venture agreement with CATL, pursuant to which we and CATL formed CAMT. We and CATL both own 50% of CAMT’s issued and outstanding shares. Under the joint venture agreement, as revised, CAMT has the exclusive right to commercialize our AirJoule technology in Europe and Asia.
Current wording
On October 27, 2021, we entered into a joint venture agreement with CATL, pursuant to which we and CATL formed CAMT. While we and CATL both continue to own 50% of CAMT’s issued and outstanding shares, neither we nor CATL funded this joint venture or contributed any assets to the joint venture. Similarly, no business plan or operating budget have ever been set by CAMT’s board of directors.
Previous wording
Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, our Predecessor and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s board of directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of the Predecessor and CATL US) will be subject to the prior mutual agreement of the Predecessor and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by the Predecessor. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents the annual financial budget of CAMT, and any transaction between CAMT and CATL US or the Predecessor in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and the Predecessor or all directors. As of December 31, 2024, we have not funded this joint venture or contributed any assets to the joint venture.
Current wording
Pursuant to the Amended and Restated Joint Venture Agreement for CAMT, entered into on September 29, 2023, we and CATL US have each agreed to contribute $6.0 million to CAMT. Contributions will be requested by CAMT once a business plan and operating budget is set by CAMT’s board of directors. No action to establish a business plan or operating budget has occurred to date. Any additional financing beyond the initial $12.0 million (i.e., $6.0 million from each of Legacy Montana and CATL US) will be subject to the prior mutual agreement of Legacy Montana and CATL US. CAMT is managed by a four-member board of directors, with two directors (including the chairman) designated by CATL US and two directors (including the vice chairman) designated by Legacy Montana. In the event of an equal vote, the chairman may cast the deciding vote. Certain reserved matters, including debt issuances exceeding $5.0 million in a single transaction or in aggregate within a fiscal year, amendments to CAMT’s constitutional documents the annual financial budget of CAMT and any transaction between CAMT and CATL US or Legacy Montana in an amount exceeding $10.0 million in a single transaction or in aggregate within a fiscal year, require the unanimous vote of both CATL US and Legacy Montana or all directors. As of December 31, 2025, we have not funded this joint venture or contributed any assets to the joint venture.
Previous wording
The purpose of our Predecessor’s joint venture with CATL US is to commercialize our AirJoule technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize AirJoule technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT), and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment.
Current wording
The original purpose of our joint venture with CATL US was to commercialize certain technology in Asia and Europe and, pursuant to the Amended and Restated Joint Venture Agreement for CAMT, CAMT has the exclusive right to commercialize the technology in those territories. Subject to the oversight of CAMT’s board, CATL US is responsible for managing the day-to-day operations of CAMT (including the nomination and replacement of the Chief Executive Officer of CAMT), and is responsible for providing CAMT and any subsidiaries formed by CAMT with, among other things, administrative services, supply chain support, assistance in obtaining required permits and approvals and assistance in purchasing or leasing land and equipment.
Previous wording
Management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which are prepared in conformity with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make certain estimates, judgments, and assumptions that we believe are reasonable based upon the information available. These estimates and assumptions can be subjective and complex and may affect the reported amounts of assets and liabilities, revenues, and expenses reported in those financial statements. As a result, actual results could differ from such estimates and assumptions. Such changes to estimates could potentially result in impacts that would be material to the consolidated financial statements.
Current wording
Management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.
Previous wording
In connection with the reverse recapitalization and pursuant to the Merger Agreement, eligible former Predecessor equity holders are entitled to receive the Earnout Shares upon us achieving certain Earnout Milestones. The settlement of the Earnout Shares to the holders of the Predecessor’s common units contain variations in something other than the fair value of the issuer’s equity shares. As such, management determined that they should be classified as a liability and recognized at fair value at each reporting period with changes in fair value included in earnings.
Current wording
In connection with the reverse recapitalization and pursuant to the Merger Agreement, eligible former Legacy Montana Equityholders (as defined below) are entitled to receive additional shares of our common stock upon the achievement of specified operational milestones. The Earnout Shares are classified as a liability and are remeasured at fair value at each reporting period, with changes in fair value recognized in our consolidated statements of operations.
Previous wording
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. We recognize accrued interest and penalties related to unrecognized tax benefits as income tax expense. Management has evaluated our tax positions, including our Predecessor’s previous status as a pass-through entity for federal and state tax purposes, and has determined that we have taken no uncertain tax positions that require adjustment to the consolidated financial statements. Our reserves related to uncertain tax positions was zero as of December 31, 2024 and 2023. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2024 and 2023. We are currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
Current wording
Management has evaluated our tax positions, including our Predecessor’s previous status as a pass-through entity for federal and state tax purposes, and has determined that we have taken no uncertain tax positions that require adjustment to the consolidated financial statements. Our reserves related to uncertain tax positions was zero as of December 31, 2025 and 2024. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2025 and 2024. We are currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
Previous wording
A discussion of recently issued accounting standards applicable to the Company is described in Note 3 –Summary of Significant Accounting Policies, in the Notes to Financial Statements contained elsewhere in this Current Report on Form 10-K.
Current wording
A discussion of recently issued accounting standards applicable to the Company is described in Note 3 –Summary of Significant Accounting Policies, in the Notes to Financial Statements contained elsewhere in this Annual Report on Form 10-K.
Previous wording
We are an emerging growth company as defined in the JOBS Act. The JOBS Act permits companies with emerging growth company status to take advantage of an extended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to use this extended transition period to enable it to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates.
Current wording
We are an emerging growth company as defined in the JOBS Act. The JOBS Act permits companies with emerging growth company status to take advantage of an extended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to use this extended transition period to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Our future capital requirements will depend on many factors, including the timing and extent of spending to support the launch of our product and research and development efforts, the degree to which we are successful in launching new business initiatives and the cost associated with these initiatives and the growth of our business generally.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
During the year ended December 31, 2024, net cash used in operating activities was $24.3 million and primarily reflected our net income from operations and decreases in accounts payable, accrued expenses and other liabilities.